It's bad to lie in order to impress people.
Terry is listening to some friends at work tell stories about their war time military service.
Terry wants to tell his friends an impressive story about himself.
Terry tells his friends a true story about a selfless act he performed in the service of his community.
Terry makes up a war story of his own, even though he has never actually served in the military.
Terry feels proud of his action and enjoys telling the story to his friends, who, in turn, admire Terry for his selfless nature.
Terry's friends have enough experience to recognize the the story is not true and Terry feels awkward when he realizes that they doubt his story.