What makes it "ART"?

I guess I just don't get it.
I really don't understand what makes something "ART".
The reason I got to thinking about it is I went to the Art Museum this weekend.
A friend who makes silver jewelry had her things at a high end "art" festival that was sponsored by the museum.
Along with about a dozen or so other ....I want to call them "vendors" but they want to be called "artists".
Okay...so about a dosen or so other "artists".
I enjoyed the show.
I thought some of the stuff was really neat.
Weavings, hand made Christmas ornaments, mosaics, pottery.
And I like my friend's work.
But what escapes me is: What makes it "ART" and not just a unique, kitchy craft that someone enjoys doing.
And WHY does it demand outrageous prices?
One woman at the show was actually selling "Tin Can Telephones" (two old soup cans painted in bright colors and attched with a string).
WHAT?????
Is it the cost of the materials?
Is it the time?
Is it the uniqueness of the creation?
Is it because you have a degree in "ART"?
I guess it's like my husband said: "Either you're artsy-fartsy or your not."
Maybe it's how you think of yourself.
It's like that old platitude, "If you want to be a writer, just call yourself a writer".
If you want to be an artist, can you just call yourself one?
What if nobody else will call you an artist.
It's a very closed community.
I like to paint a little bit just for fun.
But apparently it's not "ART".
I can cut things out on my band saw and paint them and they are clever and unique (I LOVE my fish and kitty cats). Handmade. Hand painted.
I LOVE my Wizard of Oz collage.
But apparently, they are not "ART".
We met a sweet elderly lady who was making the neatest bracelets out of troll beads to pass the time while she was waiting to visit her dying husband who was in the intensive care unit.
She sold them for $5 just to cover the cost of the materials so she could have something to do to pass the long hours. They were beautiful. They were made with love and patience.
But they were not "ART".
Where is the line here?
What exactly makes it "ART"?