"rails new project7 --edge" results in "failure bundler raised an exception, are you offline?

rails-new-edget-failure

$ rails new project7 --edge 
      create  
      create  README
      create  Rakefile
      create  config.ru
      create  .gitignore
      create  Gemfile
      create  app
      create  app/assets/images/rails.png
      create  app/assets/javascripts/application.js
      create  app/assets/stylesheets/application.css
      create  app/controllers/application_controller.rb
      create  app/helpers/application_helper.rb
      create  app/mailers
      create  app/models
      create  app/views/layouts/application.html.erb
      create  app/mailers/.gitkeep
      create  app/models/.gitkeep
      create  config
      create  config/routes.rb
      create  config/application.rb
      create  config/environment.rb
      create  config/environments
      create  config/environments/development.rb
      create  config/environments/production.rb
      create  config/environments/test.rb
      create  config/initializers
      create  config/initializers/backtrace_silencers.rb
      create  config/initializers/inflections.rb
      create  config/initializers/mime_types.rb
      create  config/initializers/secret_token.rb
      create  config/initializers/session_store.rb
      create  config/initializers/wrap_parameters.rb
      create  config/locales
      create  config/locales/en.yml
      create  config/boot.rb
      create  config/database.yml
      create  db
      create  db/seeds.rb
      create  doc
      create  doc/README_FOR_APP
      create  lib
      create  lib/tasks
      create  lib/tasks/.gitkeep
      create  log
      create  log/.gitkeep
      create  public
      create  public/404.html
      create  public/422.html
      create  public/500.html
      create  public/favicon.ico
      create  public/index.html
      create  public/robots.txt
      create  script
      create  script/rails
      create  test/fixtures
      create  test/fixtures/.gitkeep
      create  test/functional
      create  test/functional/.gitkeep
      create  test/integration
      create  test/integration/.gitkeep
      create  test/unit
      create  test/unit/.gitkeep
      create  test/performance/browsing_test.rb
      create  test/test_helper.rb
      create  tmp/cache
      create  tmp/cache/.gitkeep
      create  vendor/assets/stylesheets
      create  vendor/assets/stylesheets/.gitkeep
      create  vendor/plugins
      create  vendor/plugins/.gitkeep
         run  bundle install
Updating git://github.com/rails/rails.git
Fetching source index for http://rubygems.org/
     failure  bundler raised an exception, are you offline?

This was fixed in Rails post 3.1.0.rc4 -- see this commit: rails/rails@467772b.