As the error says, it's because /System/Library/Frameworks/Ruby.framework/Versions/1.8/usr/bin/ruby doesn't exist. Just do a manual git reset to the remote master in /usr/local - the latest version shouldn't have that issue.
Also, wrong forum. Next time you should ask on the project's ML/bug tracker.
Also, wrong forum. Next time you should ask on the project's ML/bug tracker.