Prevent external speakers in monitors connected via HDMI being used

Not entirely sure and I'm not familiar with iTerm2 but, as a workaround, does iTerm2 have audio preferences of its own? If so, check to see if your USB device is available to select as the output device.

Also check Audio MIDI Setup (Applications > Utilities).

Boom is most likely the culprit to your speaker failing. Boom uses algorithms to increase the overall volume of the track to a point without clipping. Pushing speakers beyond what they are supposed to do can and will cause damage to them. The reason the speakers have a maximum volume is that is the safest high fidelity sound they can produce.

Here is a review of how boom works algorithmically http://www.macobserver.com/tmo/review/boom_lets_you_turn_your_macs_volume_up_to_eleven

Note the overall wave form increase in the article. This will cause damage, clipping and distortion with prolonged use.