They also say

meaning they cannot be read by a third party

which equally isn’t true.

If your password is guessable with trillions of attempts, and whatever information and time an attacker wants, then of course can they crack your hash, “read” your password, and try it on other services.

Sadly the kind of password susceptible to being broken on account of not being strong enough is also the kind people use everywhere because they memorize it. A truly strong password will only be found in a password manager.