I think the question is not so much what to do with this student, but what to do with the instructor. Who in their right mind does that kind of crap in a 172?

Just say NO. You are PIC. He needs to get slapped down now. He can take all the aerobatic training he wants after he gets the PVT.

He just wants to think that he is in a Hornet. Anyway, that instructor should be scrapped. I no way should you be demonstrating that kind of flying to a pre solo pilot. Someday, that guy is going to try that crap when he is soloing and end up a smoking hole. I would also steer that student away from mountain flying until they are more experienced. And you wonder where those idiot pilots out there come from.

"There are bold pilots, but there are no old bold pilots"

Most pilots that make smoking holes in the ground have a history of behavior / attitudes that raise 'red-flags' over a sustained period of time.

This guy and his CFI will make the news one day.

I wouldn't fly with either of them...Tell it like it is - you don't fly with / teach unsafe students.

-LAFF

It's this type of mentality towards safety that end's up with a plane in the side of a building. Do not allow this attitude to persist. It effects us all.

Yup, or a disoriented/vertigo'd Kennedy augering in at night after an over water departure into marginal VFR conditions with very little flight time/experience for that "nice little trip" to Martha's Vineyard... Not to mention the other people killed in said aircraft...