undefined method `install_gem_spec_stubs' for #<Rails::Initializer:

At the beginning I thought this problem would have a simple/quick
solution with a bit of googleing.

I am trying to install/run Redmine 0.7.3

Here is the problem:

cd /opt/redmine-0.7.3/
rootsoyo933 /opt/redmine-0.7.3]#
ruby script/server
./script/../config/../vendor/rails/railties/lib/initializer.rb:49:in
`send': undefined method `install_gem_spec_stubs' for
#<Rails::Initializer:0x2b955ea30c68> (NoMethodError)
        from ./script/../config/../vendor/rails/railties/lib/
initializer.rb:49:in `run'
        from ./script/../config/boot.rb:46:in `load_initializer'
        from ./script/../config/boot.rb:38:in `run'
        from ./script/../config/boot.rb:11:in `boot!'
        from ./script/../config/boot.rb:109
        from script/server:2:in `require'
        from script/server:2

I am posting to this group because this:
from ./script/../config/../vendor/rails/railties/lib/initializer.rb:
49:in `run'
might imply this is a rails issue?:

Here are specifics about the environment:

rootsoyo933 ~]#
rake -V
rake, version 0.8.1
rootsoyo933 ~]#
ruby -v
ruby 1.8.6 (2008-08-08 patchlevel 286) [x86_64-linux]
rootsoyo933 ~]#
rails -v
Rails 2.1.1
rootsoyo933 ~]#
uname -a
Linux soyo933.linuxhome.org 2.6.18-92.1.10.el5 #1 SMP Tue Aug 5
07:42:41 EDT 2008 x86_64 x86_64 x86_64 GNU/Linux

gem list

*** LOCAL GEMS ***

actionmailer (2.1.1, 2.1.0)
actionpack (2.1.1, 2.1.0)
activerecord (2.1.1, 2.1.0)
activeresource (2.1.1, 2.1.0)
activesupport (2.1.1, 2.1.0)
rails (2.1.1)
rake (0.8.1)
rubygems-update (1.2.0)

TIA for any pointers that will lead me to the solution.