If you think you are not being watched, think again. A WSJ article from July 2010 reveals some of the nitty gritty details companies are using to track your on-line activities and resell your profile.
And Facebook uses information users have made private to target them for advertising. Some researchers at the Max Plank Institute set up six profiles based on sexual preference and then observed the advertising each received. Gay men received obviously targeted ads, even though the sexual preference info was private.
Another study by a Stanford University researcher found that she could determine the age and sexual orientation of Facebook users by tailoring certain ads to their profiles. The researcher suggested the same tactic could be used to root out other sensitive stats on an individual, including religious and political affiliation, and marital status. Errk!