A magnificent horse, and a tempting promise

A traveling horse-trader arrived at court one day leading a magnificent Arabian stallion, finer than anything in the royal stables, and told Krishnadevaraya that he had two more just like it waiting back in Arabia, which he would gladly fetch if the king would advance him the funds for the journey — a proposal the king, dazzled by the horse in front of him and already picturing the pair still to come, accepted without much hesitation, handing over five thousand gold coins and sending the trader off with royal blessings and a promise to return within the fortnight.

Days pass, then weeks, and no trader returns

The fortnight came and went without any sign of the trader, and then a full month, and the king's early confidence curdled slowly into anxiety and then into something closer to obsession, until he could be found at odd hours pacing the palace grounds, scanning the road for any sign of a stranger leading two fine Arabian horses toward the city gates.

A list is being written, and the king's name is on it

It was during one of these restless evenings that Krishnadevaraya came upon Tenali seated quietly with a sheet of paper, apparently absorbed in composing some list, and — curious, and glad of any distraction from his own worry — asked to see what his court poet was writing, only to discover his own name inscribed at the very top of a document Tenali had titled, without the slightest embarrassment, "The Greatest Fools of Vijayanagara."

The king demands an explanation

The king's alarm turned instantly to outrage, and he demanded to know by what right his own court poet dared place his sovereign's name at the head of a list of fools, whatever the list happened to concern, and Tenali — who had been waiting for exactly this question — answered him with perfect calm that any man who handed five thousand gold coins to a total stranger, on nothing stronger than the man's own word, and expected him to simply return with the goods, had earned his place at the top of any honest list of fools that anyone cared to compile.

A king pushes back, and gets a witty condition

Krishnadevaraya, stung but not yet ready to concede the point entirely, protested that the trader might still return — there was no proof yet that the man was a cheat rather than merely delayed — and Tenali, unbothered, told him that in that case nothing need be lost: the moment the trader reappeared with the two remaining horses, he would happily cross out the king's name and write the trader's in its place instead, and until then the list would simply have to stand as written.

A lesson learned, and never a horse in sight

The trader, of course, never did return, and the king — who had a healthy enough sense of humor to recognize a fair hit when he took one — kept Tenali's list rather than burning it, showing it afterward to any minister or merchant who came to him with a scheme that sounded too easy to be entirely honest, as a standing reminder of exactly how much trust five thousand gold coins and a stranger's smile were actually worth.