A great deal of misinformation is posted around the internet about cookies. Many internet users consider cookies a form of spyware and become very concerned about them. This attitude has been encouraged by the antispyware industry and programs that identify the few cookies that are known to attempt to track users’ activities. This can lead users to believe that all cookies are somehow malicious software. Cookies are small text/data files sent by a server to your browser and then sent back by the browser each time it accesses that server.
Cookies are mostly used for user authentication and maintaining user-specific information like preferences, and sometimes, passwords. There are privacy concerns about some cookies and some uses of cookies. A cookie can be used for tracking the browsing habits of a user, but this is not necessarily bad. Many sites are simply trying to work out what you want. They can’t see you, you are just an IP number to them. Interactive sites like forums need cookies to work correctly.
Cookies are not programs. Cookies do not store or send your name or address to a website. They do store their website details and can contain an IP number but this is not malicious information. Any place on the web will need your IP number so you can visit. It is your address on the web. It will change every time you log on, unless you have a static IP and most home users do not.
Commonly used browsers such as Internet Explorer, Firefox and Opera allow users to decide whether to accept cookies. Some websites don’t work properly with cookies disabled.
Tracking cookies are used by advertising networks, some shopping sites like Amazon and users that are signed into Google's email or other on-line services.
These cookies identify you only to that site and on sites where they have advertising displayed. You are not identified by name only by their internal identifiers. This is probably not a major issue as you have been using their services. However clear your cookies regularly if you aren't comfortable.
Cookies can be Important
Websites, like most media, need feedback on their audience. Many websites depend on traffic to attract advertising to support the website. Cookies provide one way for a website to demonstrate traffic flow and, more importantly, return visitors. Without this feedback huge numbers of websites enjoyed by millions of visitors a year would disappear. As an example the huge information Wikipedia needs around $US750,000 per year to run. This is mostly provided by donations. But few websites could claim, or depend on that level of support from visitors and contributors.
Most cookies will not be a problem of any kind to a user and may even help a website you enjoy stay in business.
For more information and technical details about cookies See Wikipedia Cookies
For starters these aren't called cookies but they serve a similar purpose. They are called “Local Shared Objects” LSOs. They can store up to 100KB of data so they are far more substantial than common or garden cookies.
If you use Youtube a lot you may quite a few of these as well as those placed by Flash based ads on websites. Clearing temporary internet files and cookies will not delete these. They are not plain text files like cookies.
For Windows Users Adobe have an interactive web based system that displays your LSOs and lets you remove them.
For linux users these LSOs are generally located here (to find in a file explorer you will need to enable hidden files)
Interestingly, even after the LSOs are cleared you still have a folder list of all the sites visited and all saved .swf files are not gone.
The BetterPrivacy extension will find LSOs and allow you to remove them all or select which ones you want removed.
More information about LSOs or Flash Cookies is on download page on Mozilla Add-ons.
Objection Extension for Firefox - works for Windows and Linux but is a little more obscure to use.
For linux you will need to tell it where the files are as above - copy and paste