Peridot's talking about the Fade but Cole's still a bit scared and still trying to justify his actions. She's worried. She doesn't know what to think. "I killed the Venatori because they want to end the world and I killed Lambert because he hurt people, but I won't kill here. Not unless they're trying to hurt us."

The words come out in a bit of a ramble, as Cole continues to justify himself. In his justification and slight panicking, Cole doesn't realize that he probably should specify that the Lambert he killed was a dude from his world. Whoops.

But then he backtracks a bit. He was so focused on the tragic backstory bit that Cole completely missed what Peridot mentioned. The Fade? She did mention the Fade, didn't she? How would she know about that? "This place doesn't have the Fade," Cole mentions, after a moment's pause.