Here are some good blog posts that explain this better than I can (the flow chart in 3 is particularly illuminating):
[1] https://paragonie.com/blog/2017/03/jwt-json-web-tokens-is-ba...
[2] http://cryto.net/~joepie91/blog/2016/06/13/stop-using-jwt-fo...
[3] http://cryto.net/%7Ejoepie91/blog/2016/06/19/stop-using-jwt-...