I know that the bounties here are more than likely making up a large portion of website traffic. I totally understand that to stay at the top of the alexa rankings, you need website traffic and by eliminating newbies entirely- you also get rid of a shitload of traffic.
Obviously i know what i mentioned has its possible drawbacks in terms of website traffic, the rest is just general wondering why this actually goes on here when we all know the issues it creates?

What makes you think theymos cares much about traffic? Theymos recently said he thought about removing the ad slot here completely because it's too much of a hassle for him (which I think would be ridiculous to do), so I'm not sure if theymos cares too much about traffic or the Alexia rank because traffic is only really good for monetising the site. I always assumed that sig campaigns and bounties were only allowed to remain here because to get rid of them would probably kill off at least 80% of traffic. What he should care about though is the spam and usability of the forum, and I know that bothers him too, but he's the only one that can do anything about that and he needs to start implementing certain things and listening to the community on ways to combat it. We can still find a compromise without having to ban them or removing signatures completely but it's not going to happen without some help from him or permission to start dishing out punishments for the worst of campaigns.
I don't know how much Theymos et al make just having bitcointalk operating as it is, but I think it's a substantial sum of money. If Theymos did away with bounties and campaigns, this forum would be a ghost town, and it wouldn't be earning anywhere near as much.
As I said above, theymos recently mentioned getting rid of the only ad slot we have here so I'm not sure how much the forum being monetised efficiently or not is a concern to him. Theymos makes very little directly from this forum and an active mod makes more than him per month. Most ad revenue probably goes into the pot to pay mods (and we might actually be losing money on a monthly basis), but if theymos wanted to enrich himself personally or just the forum he could do so in a multitude of ways and many I have suggested myself (more ad slots, pay himself a reasonable wage and do admin duties full time, more donator ranks amongst other things). Regardless of whether theymos cares about ad revenue or traffic we should work together to make sure the forum is fit for purpose and he himself said this board shouldn't be a 'welfare system' for people but that's what it is right now so we need to find a compromise between people getting paid and what is and isn't acceptable to be paid for and punishments for people who do it the unacceptable way. If we let people get away with paying and being paid for spamming then they will continue to do it.