George is initially insulted by the question, but then is provoked into a more secure feeling and he confesses his cruel joke. George needs forgiveness and to be heard. It truly IS unusual for guy to trust each other. George is defensive about this strangeness but then takes ownership of this relationship as it is bonded in his guilt about that moment. What Lennie takes as George's loyalty is truly George's guilt.
This observation gives George a chance to tell the truth about his relationship with Lennie. He tells Slim that he and Lennie were born in the same town. George knew Lennie’s Aunt Clara who had raised Lennie from infancy. When she died, George became his caregiver. He confesses that he played tricks on Lennie in the past but stopped when he realized Lennie’s loyalty was so strong that he would do anything George required. He also reveals what really happened in Weed, the site of their last job. This gives Slim an idea of Lennie's strength and paves the way for Slim's later understanding of George's actions at the end of the novel.