Popular definition seems to be: knowledge of what is true or right, and the ability to act accordingly.
It's clear that Elves will amass much more knowledge than any man, hobbit or dwarf; but how much of this knowledge relates to things that are, shall we say, inessential? Things like languages, names, places -- later creations.
Bombadil claims to be the first: maybe his wisdom is purer. Maybe what followed is all superfluous to true wisdom. Or maybe he's like one of those annoying people who claim that all modern music is pointless because true music ended with Beethoven.
