I ran gem update --system to update to Rubygems 1.5.0 and after every time I run any bundle commands I get:
gem update --system
bundle
rvm/gems/ruby-1.8.7-p249/gems
It looks like RubyGems 1.5.0, which just came out today, is incompatible with Bundler 1.0.9.
You'll probably want to downgrade back to RubyGems 1.4 until an update is released for Bundler (which will likely be very, very soon).
Update: Bundler 1.0.10 is out now.