Hi confidence-devil,
Some techniques need time to sink in; allow yourself some time. In other words, start perhaps with three joints and a cylinder (no caps even) and explore it. Bind it, try to set a different weight to points, and look at how that changes the outcome.
Think of a joint as a handle for a single point or many points in a group. To be able to have several joints moving the mesh (the group of points that creates the polygons), a weighting is introduced. This weighting for a single point is like how much all joints share the influence of a single point. Like joint-1 has 80% influence, and joint-2 has 20%. It is always 100%. Otherwise, things move weirdly. Something that the video series mentioned above sadly does not showcase in terms of why. But if it is over 100%, the mesh will move faster; if it is below, it stays behind.
In summary, A joint is just an object that creates changes on a mesh. Each joint can have more or less influence on a mesh. All rig joints move the surface (mesh) to absolute 100%, not more, not less.
Joints are not baked to joints.
This technique is a longer story; hence, we made a whole series, which needs a few hours to cover the basics. If you like to feel savvy with it, use that series. Perhaps watch another one, as each character animator has a different idea of how to weigh the rig.
Yes, it takes some time, as said above, and any shortcut taken now will slow down the work later on, and the "saved" time will be paid with interest. 
Above: It is not a single paragraph; it is a simple list of steps I took to get your rig working. That means it is a way of fixing things, not how they will be done.
Your headline has "Retargeting" in it. So, I wonder what source you like to use?
Remember that the human bone rig has a hierarchy and is all about fixed length of bones and rotation. Not so much of position transfer as the position is typically a result of rotation and fixed length. The Retargeting needs to be modified if you have only Arms as a rig, while using a full body rig as source.
Enjoy your exploration