InvocationTargetException when running applet locally

[Mickey Segal]

For years, we've used the ability to run our signed Java applet locally when we are in a location without internet access.  That seems no longer to work as of Java 7 update 45.  When the applet is launched, a java.lang.reflect.InvocationTargetException is thrown.  I assume this is a result of something done to block some security hole, but does that mean there is no way anymore to run a Java applet locally, even if it is signed?

No message shows up in the Java Console, and even a println put right at the beginning of the program gives no console output.

In Java 7 update 25, there was also a problem running applets locally, but it was getCodeBase returning null, something that could be solved by hard-coding the codebase.  

Is there any workaround to this issue in 7u45?  

Can one stay at 7u40 indefinitely?

Does switching to a Java 8 build get around the issue?