Davos doesn't trust this. Where are their ships? See, it wasn't a stupid question after all. It seemed like it was when Joffrey said it, but if Davos wants to know, there must be some merit in it. Matthos says it's wise to attack at night, because they're taking King's Landing by surprise. Davos thinks it's impossible to take Varys by surprise. Matthos suggests that maybe the Lannister sailors have mutinied. Davos doesn't buy it. He's not as pessimistic as Sansa, but he certainly doesn't think everything's going to magically work out either.
Cersei walks into a room filled with women. This would be Maegor's Holdfast, then. Sansa is talking to Shae about how she doesn't even know why Cersei wanted her kept safe. Cersei thinks she's stupid! Shae suggests that maybe Cersei just hates Sansa a little bit less than she hates everyone else. Sansa doubts that. Shae suggests that it might be jealousy. Does Sansa have enough vanity left to buy that?
Cersei calls Sansa over for some uncomfortable conversation. After establishing that her "red flower is still blooming" Cersei draws a parallel to the men bleeding out there and Sansa bleeding in here. Cersei makes Sansa drink some wine. Sansa asks why Ser Ilyn (the ugly-looking galoot) is there. He's the last line of defense. There are guards outside, but they'll sneak away when things get bad. A man comes up and reports that some servants were caught trying to steal stuff and run away. Cersei wants Ser Ilyn to put their heads on pikes. She gives Sansa a useful tip for a future queen: you want the smallfolk to fear you more than they fear the enemy. Sansa asks how Ser Ilyn chopping off a maid's head protects them and Cersei explains that traitors are a danger to them all. I see. Cersei gets more wine and I think she's had plenty already.
Everyone stands on the wall. Joffrey is the first to see Stannis's fleet come out of the fog. Tyrion gives the order for archers to get to their marks. There are, in fact, a lot of archers. They nock their arrows. Tyrion has the archers hold fast, which sends Joffrey into a frenzy of Joffrey-ing. He wants to attack now now now! Then Joffrey sees that there's only one ship. Where are the rest of them? I'm surprised Joffrey knows nothing about the defense plans, since just last episode he was walking the wall with Tyrion and Varys. I guess he was preoccupied by what to name his sword. You just know he's got a scroll with a bunch of ridiculous rejected names.