ROR Bundle Install will not install missing gems

When trying to start a rails server on my machine I got the following:

Could not find gem 'sqlite3 (>= 0)' in any of the gem sources listed in your Gemfile.
Run `bundle install` to install missing gems.

This is the error is receive when trying bundle install

bundle install
Fetching source index for http://rubygems.org/
Using rake (0.9.2) 
Using abstract (1.0.0) 
Using activesupport (3.0.9) 
Using builder (2.1.2) 
Using i18n (0.5.0) 
Using activemodel (3.0.9) 
Using erubis (2.6.6) 
Using rack (1.2.3) 
Using rack-mount (0.6.14) 
Using rack-test (0.5.7) 
Using tzinfo (0.3.28) 
Using actionpack (3.0.9) 
Using mime-types (1.16) 
Using polyglot (0.3.1) 
Using treetop (1.4.9) 
Using mail (2.2.19) 
Using actionmailer (3.0.9) 
Using arel (2.0.10) 
Using activerecord (3.0.9) 
Using activeresource (3.0.9) 
Using bundler (1.0.15) 
Using rdoc (3.6.1) 
Using thor (0.14.6) 
Using railties (3.0.9) 
Using rails (3.0.9) 
Installing sqlite3 (1.3.3) /Library/Ruby/Site/1.8/rubygems/installer.rb:584:in         `initialize': Permission denied - /Library/Ruby/Gems/1.8/gems/sqlite3-1.3.3/API_CHANGES.rdoc (Errno::EACCES)
from /Library/Ruby/Site/1.8/rubygems/installer.rb:584:in `open'
from /Library/Ruby/Site/1.8/rubygems/installer.rb:584:in `extract_files'
from /Library/Ruby/Site/1.8/rubygems/installer.rb:564:in `each'
from /Library/Ruby/Site/1.8/rubygems/installer.rb:564:in `extract_files'
from /Library/Ruby/Site/1.8/rubygems/installer.rb:179:in `install'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/source.rb:101:in `install'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/rubygems_integration.rb:78:in `preserve_paths'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/source.rb:91:in `install'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/installer.rb:58:in `run'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/rubygems_integration.rb:93:in `with_build_args'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/installer.rb:57:in `run'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/spec_set.rb:12:in `each'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bun开发者_运维百科dler/spec_set.rb:12:in `each'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/installer.rb:49:in `run'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/installer.rb:8:in `install'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/cli.rb:222:in `install'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/vendor/thor/task.rb:22:in `send'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/vendor/thor/task.rb:22:in `run'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/vendor/thor/invocation.rb:118:in `invoke_task'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/vendor/thor.rb:246:in `dispatch'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/lib/bundler/vendor/thor/base.rb:389:in `start'
from /Library/Ruby/Gems/1.8/gems/bundler-1.0.15/bin/bundle:13
from /usr/bin/bundle:19:in `load'
from /usr/bin/bundle:19

I have tried:

sudo gem install sqlite3-ruby
Building native extensions.  This could take a while...
ERROR:  Error installing sqlite3-ruby:
ERROR: Failed to build gem native extension.

/System/Library/Frameworks/Ruby.framework/Versions/1.8/usr/bin/ruby extconf.rb

mkmf.rb can't find header files for ruby at /System/Library/Frameworks/Ruby.framework/Versions/1.8/usr/lib/ruby/ruby.h

Gem files will remain installed in /Library/Ruby/Gems/1.8/gems/sqlite3-1.3.3 for    inspection.
Results logged to /Library/Ruby/Gems/1.8/gems/sqlite3-1.3.3/ext/sqlite3/gem_make.out

These are the steps that you have to do:

1. Install MacPorts from here
2. From command line, run 'port install sqlite3 +universal'
3. From command line, run 'gem install sqlite3-ruby'
4. Go to your application folder, 'rails server' and voila! you should see your server getting started

Mohit's answer did not work for me, but I ended up solving this same issue by simply deleting the /Library/Ruby/Gems/1.8/gems/sqlite3-1.3.3 folder and running 'bundle install' again. Success!