I see that there is nothing to prove, and there is absolutely no point racing with every single idiot that revs his engine at you. I got the car for my personal enjoyment, not to prove which car is faster. There will always be another car that's faster, better, or more expensive.
I usually look over, give a smile and a nod, and that's it. If the other driver chooses to speed through the street, and plows into other cars or pedestrian, that would his own choice.
At the end of the day, I go home in my X knowing that I made a good decision in getting the car, and not my car is faster than x, y, z.