Warren Buffett On Steve Jobs, Wells Fargo Controversy, Picking Winners, And More (AAPL, WFC, BAC)

What does Warren Buffett think of Wells Fargo

? Why did he pull out of Bank of America

? Is Apple

in trouble? Buffett answered these questions and much, much more during his three-hour interview with CNBC this morning.

Buffett said that while Wells Fargo didn't handle the

very well, Howard Atkins has nothing to do with Berkshire Hathaway Inc.'s

financials. “I feel very good about the whole Wells operation,” Buffett said. “Obviously there's something there beyond what was in the news release. It's a tough thing. If you got something that neither side wants to talk about, they're not gonna talk about it.” But if Buffett is such a fan of Wells Fargo, why did he get out of Bank of America

before turning a profit? “I've never bought a share of Bank of America,” Buffett said. “That was one of the 15 [liquidated stocks] of Lou Simpson. He did not make a decision to sell… He sold Nike

– he hated to sell Nike. He was clearing out his portfolio.”

One CNBC viewer wanted to know why the managers of Berkshire Hathaway Inc. were allowed to liquidate Lou Simpson's portfolio when he retired. “I buy stocks with the idea I'd be happy with holding them forever,” Buffett said. “But Lou Simpson was managing his own portfolio; he managed it for 21 years. He did a sensational job. When he said he was going to leave, he and I decided he would liquidate his portfolio by the

.”

When it comes to credit card investments, Buffett has some

. On one hand, Buffett has invested in American Express Company

, a company with cardholders who spend an average of $13,000 to $14,000 annually. “It is a superior card for someone that is a big spender,” Buffett said. However, Buffett also feels that we'd be better off if credit cards did not exist. “I tell students they'd be better off if they never used them,” he said. “I can't make money if I'm out borrowing at whatever the rate may be, 12%, 14%, 16%. If I'm gonna go broke if I borrow at credit card rates, I'm in trouble.” “People are gonna [use them],” Buffett added. “I understand why they do it – it's so nice to think they [can have it] today and will pay for it tomorrow.”

When asked if the Steve Jobs saga had taken its toll on Apple

, Warren Buffett said that while he didn't know much about the company, he believes it is a

. “And that's been done by innovation,” Buffett said. “He's enormously important to Apple. Walt Disney was important to Walt Disney Co.

. There are certain talents that are really rare.”

During his interview with CNBC, Warren Buffett said that it's

. “General Motors

ruled the world when I was a young investor,” he said. “Sears

ruled the world of merchandise.” Today, however, those two entities are no longer number-one. “Know there will be winners,” Buffett said. “In media there will be huge winners. Imagine being in the mind of Facebook five years ago. But I am not the guy who can do that.” “And thankfully,” he added, “I don't have to be the guy who does that.”

Buffett took a moment to address the

that Geico spent on advertising last year. “With three quarters of our quotes coming from the Internet, what drives Geico?” Buffett questioned. “Certainly television does it. All I know is [that] it's working.” Geico recently had a gain of 130,000 policy owners in just one month. Buffett attributes the firm's success to its ability to save customers money. “That little gecko does wonders,” Buffett added.

If you have a privately-held enterprise, Warren Buffett advises that you should not sell it “unless there's some compelling reason other than the dollars you'll get from it.” Those dollars, Buffett says, will not allow you to build a better business than the one you currently have.

“We have a situation in congress where we have a 10% deficit in terms of GDP,” Buffett said. “Inflation is the

; it taxes people who don't know they're being taxed. It's not the way the government should behave, but it is the way they behave.” Buffett said that we are following policies that will lead to inflation down the road if we don't change. “It's like jumping off a building; the first 40, 50 stories you don't notice a difference,” he said. “But eventually you hit the ground.” Further, Buffett said that he is suspicious of all economic forecasts. “I think anybody who tosses out a bill [and] says, ‘This will save us,' I don't think they know what they're talking about,” Buffett said, joking that he wasn't sure if he knew what he was talking about either.

“If you look at the top-level people in the country, we're paying our lowest tax rates in a long time,” Buffett said. “So I think there could be something done for people done at the top level. Not for people making $250,000 but for people making much more.” Buffett later said that you can do a lot with those who have an annual income of $1 million or higher. “I do think that many states and municipalities have made promises on benefits that really can't be fulfilled,” Buffett said. “I identify with the municipal employee… One thing you can't do is to continue making new promises.”

One CNBC viewer wrote in and asked why Buffett is urging billionaires to give the majority of their wealth to charity when they could be using it to help pay off the national debt. “In terms of the net debt, it would knock off about 7% or 8%,” Buffett said. “It would wipe out about six months of the deficit and then we'd be back to where we started.” Buffett also said that he doesn't think you should have a tax system based on free will contribution.

To ensure that corporations don't repeat their past mistakes, Buffett said that each firm's board should have compensation policies that reward and penalize accordingly. “Board of directors should have compensation policies that make sure that if the CEO fails, he goes away poor,” Buffett said. “Incentives matter enormously.”