Why are the ads so terribly targeted? They are an ad company with immense data collection and at the end of the day the ads are equivalent to a niche cable network
Let me be a bit more specific. You remember the weirdness of seeing ads for mesothelioma lawsuits on network TV? It seems way too specific to be worthwhile to advertise to general audiences. But that's missing how profitable each lead is - if a lead is worth a hundred times as much for mesothelioma as buying a Star Wars toy, you only need a hundredth of the audience interest in order for the ad slot to be price competitive.
Essentially, you're seeing the most valuable advertisement in the eyes of the advertiser, given the tracking and metrics that Facebook exposes to advertisers. It gets some weird effects, like getting tracked visiting the website of the coding bootcamp you graduated from, putting you in an "interested in coding bootcamps" category that Facebook sells to advertisers, getting you the least relevant ads possible.
And all that real world demographic data that gets bought and sold and tied to these online identities, it's not very accurate.
That's my guess anyway. And I work in (and/or closely with) marketing.
.edit:
Come to think of it, I want to elaborate on that.
Think about search engine optimisation. It's in a similar vein. "A guy walks into a bar, bars, pub, tavern, pulic house, irish pub, drinks, beer, acolhol, bar stool" etc.
My point is; people that are trying to sell 1 thing, might focus on reaching AS MANY PEOPLE AS POSSIBLE, over focussing on getting the right (but smaller) audience.
Don't blame the tool. Blame the person wielding it.
Facebook often has local events, and small businesses advertising to me. That is more like the advertising that I want and I have actually clicked through and purchased from them.