The physicist is incorrect. I believe he is mixing up enthalpy with Gibbs energy. Endothermic and Exothermic (i.e. enthalpy) reactions do not solely determine the spontaneity of a reaction, entropy must be taken into account as well. read more
Stretching is therefore endothermic, taking energy in, and releasing it exothermic, letting the energy out. The surprise is that you would think the work done in stretching the band might provide the energy needed to achieve the molecular rearrangement required, but it seems not. read more
A3: In part A of the experiment, the stretching of the balloon result in heat being released. Based on my answer, stretching is an exothermic process. read more