I'm not sure about Buffet's advice, but John Bogle (founder of Vanguard) recommends bonds so that you can rebalance your portfolio to your desired asset allocation when stocks are down by simply selling some bonds to free up capital.

So if you have 90% stocks and 10% bonds but the market takes a dive and now you're at 80%/20%, you can sell enough bonds to bring you back to a 10% bond allocation and use those funds to buy more stocks.

That is probably another example of where his policy doesn't apply to most of us. My guess is that their is more than enough cash such that 10% in short-term gov bonds would throw off sufficient income for his wife to live very comfortable while the 90% in the equity index is most invested for growth of capital (even though it throws of dividends, too).

Probably for liquidity, but I don't know for sure.