Gems might be installed in more than one area.

Look in ~/.gems and make sure that you use sudo when installing gems.

Do you now have multiple ruby directories on your mac? if so you most
likely have multiple gems directories too...

what I found was best when I upgraded from 1.8.6 to 1.8.7 was to
remove all gems directories and start empty. I can't remember what the
issue was but it was a path issue or something like that.
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