1. A virtual machine allocation system comprising: a host comprising a processor having a hypervisor executing thereon, the hypervisor executing instructions to: responsive to receiving a request to execute or allocate a virtual machine on the host, determine a first geophysical location of the host by acquiring first geophysical data from one of: a global positioning system unit coupled to the host; data manually input by an administrator; a radio signal received from an atomic clock source; or signal latency of communications with at least one regional peering host; verify the first geophysical location corresponds to a second geophysical location of the host as indicated by second geophysical data stored on the host; responsive to verification that the first geophysical location corresponds to the second geophysical location, determine a geophysical policy for the virtual machine which indicates a geophysical location where the virtual machine may be executed or allocated; determine whether the geophysical policy for the virtual machine corresponds to the first geophysical location of the host; responsive to determining that the geophysical policy for the virtual machine corresponds to the first geophysical location of the host, execute or allocate the virtual machine; and determine and re-verify the first geophysical location of the host in response to a clock adjustment of the host.