He is illustrating that "belief" has more than one meaning, for all that he hasn't clarified the meanings.

A candidate theory would be belief-as-cold-hard-fact versus beliefs-as-hope-and-commitment.

Consider a politican fighting an election. Even if the polls are strongly against them, they can't admit that they are going to lose as a matter of fact, because that will make the situation worse. They invariably refuse to admit defeat. That is irrational if you treat belief as a solipsistic, pasive registration of facts, but makes perfect sense if you recoginise that beliefs do things in the world and influence other people. If one person commits to something , others can, and that can lead to it becoming a fact.

Treating people as nicer than they are might make them nicer than they were.