Warren Buffett's business partner kicked himself for making a multibillion-dollar error —and explained how he avoids repeating mistakes

• Warren Buffett's right-hand man missed out on billions of dollars due to a single mistake.
• Charlie Munger made the costly decision not to buy more shares of Belridge Oil in the late 1970s.

Warren Buffett's 97-year-old business partner explained why he welcomes market panic, reflected on one of the pair's best investments, and recalled how he personally missed out on a multibillion-dollar windfall during a recent episode of the "Think With Pinker" podcast.

Charlie Munger, the vice-chairman of Buffett's Berkshire Hathaway conglomerate, also criticized mutual funds for misleading marketing, detailed how he avoids repeating mistakes, and underlined the importance of seizing opportunities when they appear.

Here are Munger's 10 best quotes from the interview, lightly edited and condensed for clarity:

1. "Value investors like Warren and me look for intrinsic value and ignore the noise of the constant movement of stock prices. But we look at the patterns of the noise to pick our hiding places for value investments in both time and place."

2. "The Washington Post was just a trove of intrinsic value. Here was a time of low stock prices and panic, and a place where one stock got clobbered for an unusual reason to a suddenly low level. We just charged in and bought $10 million worth of The Washington Post, and in due course it became worth $1 billion." — Munger noted the newspaper owned television stations that were "total gold mines," and fears of retribution from the Nixon administration after the Watergate exposé had hammered its stock.

3. "An idiot could figure out that The Washington Post was selling at a huge discount to intrinsic value. An opportunity like that doesn't come along very often. But you don't need an opportunity like that very often, once in a lifetime is enough."

4. "Every good card player knows that you've got to not blow your opportunities. You don't get that many. Not enough people carry that card-playing wisdom over into practical life."

5. "You don't get that many good opportunities in a lifetime. It really matters whether, when the few do come along, you reach out and grab them vigorously."

6. "It really helped us to have everybody else believe in the efficient market theory in its hardest form. It was an interesting example of a learned profession going bonkers." — referring to the idea that markets correctly price assets so bargains don't exist.

7. "The trouble with the efficient markets idea is that it was approximately right, but economists got the idea that it was absolutely always right as if it were a law of physics, and of course it wasn't. Warren and I had the advantage of being imperfectly educated, and therefore we thought the academics were stark raving mad. Which of course they were."

8. "It's really fraudulent what they do. Nobody in the mutual-fund world seems to find that practice of picking a phony winner like that, and then using it in the advertising, as crooked and detestable. But of course it is crooked and detestable." — blasting mutual funds that launch a bunch of different strategies then later pick the best-performing one to trumpet and ignore the rest.

9. "It was one of the stupidest mistakes I ever made. Now, it doesn't look on my record like I'm that stupid because I started with nothing and I have billions. But I would have had twice as many billions if I'd just made a different decision about Belridge Oil." — Munger bought 300 shares of the energy company's shares in 1977, but declined to buy another 1,500 shares shortly afterward. Shell acquired Belridge two years later at about 30 times the price he paid. If Munger had amassed 1,800 shares of Belridge, he could have sold them for $6.6 million and invested that money in Berkshire for a stake worth more than $10 billion today.

10. "I just know that if I rub my nose in my own mistakes, I'm less likely to commit new ones of the same type. So I just go through my life rubbing my nose in my own past mistakes. It works in training a dog and so I think it would work on me."

Read more: Mario Gabelli has racked up a 7,000% gain on Berkshire Hathaway stock. The billionaire investor explains why he likes Robinhood, still backs Warren Buffett, and worries about the Fed taper.