I saw a movie and all I can remember is some kids and the one scares other kids off by saying his blood is infected he cuts himself or something to show his blood. It's a older movie and not a scary movie

Here's a possibility:

The Cure (1995)
Starring Joseph Mazzello, Brad Renfro
IMDb synopsis:
Dexter has AIDS and becomes friends with Erik, the kid next door. Erik becomes closer to Dexter's mom Linda than his own who is neglectful, bigoted, and violently forbids their friendship. When the boys hear of a doctor in New Orleans who has a cure for AIDS, they leave home and embark on a journey down the Mississippi River to find him.

The Cure (1995) - IMDb (http://www.imdb.com/title/tt0112757/)

I think that he does that when bullies are threatening them.