In the novel, The Tae of Pooh, we are introduced to a picture of, The Vinegar Tasters. We are told there are three masters that are sampling vinegar, and each represents the Essence of Life. The third man, Lao-tse, is smiling, whereas the other two were either making a sour or bitter face. From knowing this, we can tell Lao-tse, of the three men, is the optimist one, because though vinegar does not have the "most pleasant taste", he does not look at it with an "unappreciative mind" as the others do. Instead, he smiles. Using Hoff's response, he is smiling because his understanding changes what others may perceive as negative into something positive, through working in harmony with life's circumstances. The vinegar in the bowl represents life, when understood and utilized for what it is, is sweet (which is why Lao-tse is smiling. To him, the vinegar is sweet.)
However, what I disagree with or do not understand my self, is that Lao-tse does not have much understanding of or how to use vinegar, so if vinegar represents life, he would have to understand and know how to utilize vinegar, for it to taste sweet, no? Other than that, I would have to say, I agree with Hoff's response, therefore, I do not have my own individual view to this question. I could say that, "perhaps he just likes the taste" or, "perhaps he just finds the situation funny", however, because it is an "allegorical" scroll, the meaning is perhaps one which is deep. Then again, because allegorical can mean to have a timeless meaning - then there is no one meaning as to why Lao-tse is smiling.