Bob Dylan is clearly not impressed with most modern musicians. I think Bobby is getting a lot more controversial in his old age (or is he reclaiming the controversy of his youth?). I've read bits and pieces of his biography Chronicles, including sections where he distances himself from the people of the '60s who looked to him as some sort of messiah. It was a bit of a surprise to read him expressing so much distaste for those who labelled him "the voice of the generation"; I'd heard him being branded that before, but took it to be just another of those compliments. But to Dylan, one comes to realize, it meant the complete opposite of who he wanted to be, much to his chagrin. In this light, I suppose the mystery behind Self-Portrait is more or less solved - I imagine it was just Dylan deciding that he'd had enough of it all, and wanted to have some fun with the listeners, no doubt anxiously awaiting a masterpiece.

Reading through some discussions on Dylan's comments, such as this, it seems that people are interpreting what he said in different ways. I don't think Dylan cares anymore how people interpret him, but anyway - I don't think he's attacking all modern music, just the sort of mainstream songs you see on MTV or Channel V which is promoted as being great beyond words. I'm pretty sure Dylan's aware of some of the less-commercial groups and artists out there today, and don't think he wanted to make a blanket statement dismissing all modern music.