Yes, you get encrypted communication all the way to the person intercepting your internet traffic, and they have an encrypted channel to the server they are relaying your traffic to.
Encrypted communication is not very useful if you aren't sure who you are communicating with. Using a self-signed cert greatly increases this uncertainty.
I would agree with you entirely if I had more reasons to transitively trust the root certificates authorities than to trust the people I believe are building the website, because in reality I don't know any of them. Certificate authority getting hacked and issuing trusted certificates to not trust worthy people have happened already. You may say that you still put more confidence in a certificate that is transitively trusted by those your browser and / or OS vendor chose for you, but why? The SSL certificate system as it is now is highly unsatisfactory to me. I would prefer something decentralized like the GPG trust network.
