Why do people always exaggerate when they tell stories?

I think your title is in itself is a fine example of your observation.

G

I've said the same thing a million times. 

Not my case. But let me tell you that I'm very fortunate to write here, because here is so cold that if I had to speak we would have to fry the words to ear them.

Well I happen to like hyperbole more than anything...

The more interesting, the more juicy, the more unexpected, the more perfect.... It's a social expectation - unfortunately.

I absolutely positively never ever exaggerate.

If you have been to Tenerife then I have been to Elevenerife ; )

And no-one's even mentioned 'literally'!!

Or 'up and down the country' - if you are a politician

When people say 'its only 5 minutes down the road' then I automatically add 5 minutes more (at least) so its 10 minutes or more down the road in reality - this I just accept - part of strange human nature - it happens

'Embellishing stories'  Every one wants to be noticed, found interesting, one gets this all the time especially in Media, who wants the plain facts, the grey truth when an exciting story of an interview of a celebrity fulfills the expectations of all the modern age viewers who might switch off the tv to play a game on mobile within a split second.

However there is one part that grates on me is when 'embellishment' goes too far to become a lie and therefore gives a different perception on the story, can also have devastating effect  to the victim... now we are entering to the world of News, Facebook, Twitter ..litigation..etc

You should post this on Google Quora.    You will get a ton of responses from experts.  They seem to love thought questions like this.