Conversation With A Man in A Restaurant (In Indonesian)

Him: Do you speak Indonesian?
Me: Yes.
Him: A little bit?
Me: Um.. Yeah. Sure...
Him: Are you exchange students at the university?
Me: No, actually, I'm a teacher at the international school.
Him: Oh, really?
Me: Yes, sir.
Him: How long have you been here?
Me: Four years. But she (motioning to my friend) has been here one year.
Him: Oh, that's nice. Where are you from?
Me: America.
Him: America, huh? Both of you?
Me: Yes, sir.
Him: Do you feel safe?
Me: Umm... In America or in Indonesia?
Him: I mean over there by the international school. Do you feel safe living there?
Me: Oh.... uuuhmm.... well, yes. It's safe.
Him: Really? Are you sure?
Me: Uuuuhhhh.... Yeah?
Him: Even with all the Muslims?
Me: Umm... Oh...  Wait. WHAT?
Him: OK. Excuse me, I have to go now.
Me: Okaaaay... Bye...

Whenever I flounder in a conversation, I play it back in my mind, over and over, and I generally come up with a dozen things to say that would have been better than what I actually said. But this time, I've got nothing.

That happened at dinner, 3 hours ago, and I still feel entirely creeped out and at a loss for words. How am I supposed to take that??