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I'm telling a story to my friends and one thing I've noticed is that usually when stories happened in the past the past tense form is used. But I have a question here:

Can I use: So then I say what the hell is going on in here or does it have to be

so then I said what the hell was going on in here.

It's supposed to be a sentence taken from a story of a past event.
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In colloquial speech, people sometimes narrate past events in the present tense (this is also sometimes used as a literary device). It can give the story a greater sense of immediacy. I am not personally a huge fan of this style, but it is not wrong. If you are telling the story using the present tense, you can say:

"So then I say, 'What the hell is going on in here?'" (a direct quote of the words you spoke)

"So then I ask what the hell is going on in there." (reported speech)

If you are telling the story using the past tense, you can say:

"So then I said, 'What the hell is going on in here?'" (a direct quote of the words you spoke)

"So then I asked what the hell was going on in there." (reported speech)
Thanks Mr. Wordy,

But I shouldn't mix tenses right? Like start the story using:

I was in New Orleans during Mardi Gras and coincidentally saw a friend, so we started chatting and she says what a coincidence!

I'm in New Orleans during Mardi Gras and concidentally see a friend, so we start chatting and she said what a coincidence!
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PreciousJones
But I shouldn't mix tenses right?

No, you should stick with the same tense throughout.

On another note, I think it's best to be clear, especially in writing, whether you are using direct speech or indirect (reported) speech. In the first case you should use quotation marks:

... and she said "What a coincidence!"

In the second case you need to adapt the words so that the sentence as a whole is grammatical and flows properly:

... and she remarked on what a coincidence it was.
Mr WordyIn the second case you need to adapt the words so that the sentence as a whole is grammatical and flows properly:

... and she remarked on what a coincidence it was.
Wouldn't it be: she remarks on what a coincidence it is?
PreciousJones
Wouldn't it be: she remarks on what a coincidence it is?

Well, it depends on whether you're telling it in the past tense or present tense, both of which we've established are OK.

(In reality, the word "remarks" may not be very conversational; I just chose it for the sake of the direct/indirect example.)
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In story writing, mixing tenses is fine, a style known as the historical present.
English 1b3In story writing, mixing tenses is fine, a style known as the historical present.
No, if you write in the historical present then you stick to the present. You don't switch to the past tense in mid-sentence, which is what we're talking about.
I'm suggesting that you can start a sentence in the past simple and move to the present simple later in the sentence:

I was walking home the other day, and all of a sudden, this guy comes up to me and says
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