By banning liquids they are stopping home made liquid bombs from being mixed on board.
Just in case you weren't joking,
mickjoebill:
There are no innocuous, water-like fluids that could be mixed in flight to produce a bomb. Binary high explosives exist, but the individual chemicals are quite nasty in their own right, and you need the facilities of a chemical lab to mix them without a premature 'fizzle'.
And if such chemicals
did exist, the current policy of confiscating water bottles would be unable to prevent their use. The searches are (inevitably) much less than 100% effective, and there's no penalty for detection other than the confiscation of the liquid. So a determined terrorist could simply carry on trying until they succeeded. As the IRA used to say: "You have to be lucky every time. We only need to be lucky once."