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But it is not absurd. Facebook doesn't target ads at you, Bob Jones.

It takes all of Bob's activities and pushes them into bins based on how they characterize Bob; Male, lives in Iowa, 18-25, etc. a bin (Moves to LA, for example), his data will contribute to different bins. This activity is disconnected from Bob at this point; and the data is aggregated away from single interaction events. "Bob visited foo.com" as a single event is gone at this point.

The models grind on these aggregate data bins.

Then when ads are targeted at Males who live in Iowa, aged 18-25 -- those ads get shown to Bob, because he is tagged with those tags.

They don't "keep track of which webpages you visit", not for more than a day. Those events get pushed in large aggregate stores of activities pretty fast. These aggregate stores are vastly smaller than if you kept all the individual data, hence much cheaper.