Why I am seeing the open windows in the host through the VM?

Is there a way to fix the following?

Notice how in the background I am able to see whatever I have open on the host. At first, I thought it was a misconfiguration in the Picture in Picture but have tried the Opacity in Full Transparent and Full Opaque with no changes. This is very annoying and if I share my screen everyone at the meeting is able to see the same. I am using the latest version of Parallels, the host is MacOS Catalina 10.15.7 and the VM OS is Fedora 34 with no Wayland installed.

 

I couldn't see the host through the VM like you said, so I opened your image in an editor to adjust the brightness/contrast, and I cannot see what you're seeing. It just looks like a regular window to me. No transprency.

 

@bradland here is another one, not sure but I am seeing something in the back of the VM

 

here is another example notice a chat window in the background