The Jester entertains the King pretending to be a fool. He laughs at the King's nonchalance while the King has no idea that it is his Jester who really rules the kingdom as it often happens ?
The King laughs at the Jester not because he is amused to watch the Jester acting. The King is not that silly ? He sees through his Jester and laughs that the Jester, in his naivete, believes in being the Master of Fates.
The King goes on leniently playing fool because he does not believe in the power of the Jester...

The jester does not know that the wire from a control panel is not connected,
And king knows and consequently is dared...