Gems installing in vendor/ruby when doing bundle update

Is it normal to have the following directory structure under "vendor"
in Rails 3?

/ruby/1.8/bin
/ruby/1.8/cache
/ruby/1.8/doc
/ruby/1.8/gems
/ruby/1.8/specifications

I removed the directory and did a bundle update, and it put the
directory and its contents right back. I'm a little fuzzy on bundle,
so I don't know if this is normal behavior.

The directory is not listed in my gem environment:

RubyGems Environment:
  - RUBYGEMS VERSION: 1.3.7
  - RUBY VERSION: 1.8.7 (2010-04-19 patchlevel 253) [i686-
darwin10.4.0]
  - INSTALLATION DIRECTORY: /opt/ruby-enterprise-1.8.7-2010.02/lib/
ruby/gems/1.8
  - RUBY EXECUTABLE: /opt/ruby-enterprise-1.8.7-2010.02/bin/ruby
  - EXECUTABLE DIRECTORY: /opt/ruby-enterprise-1.8.7-2010.02/bin
  - RUBYGEMS PLATFORMS:
    - ruby
    - x86-darwin-10
  - GEM PATHS:
     - /opt/ruby-enterprise-1.8.7-2010.02/lib/ruby/gems/1.8
     - /Users/me/.gem/ruby/1.8
  - GEM CONFIGURATION:
     - :update_sources => true
     - :verbose => true
     - :benchmark => false
     - :backtrace => false
     - :bulk_threshold => 1000
  - REMOTE SOURCES:
     - http://rubygems.org/