Can't convert fixnum to string during rake db:create

Just created a new blog app using rails 3.0

my model is simple:

class Post < ActiveRecord::Base
  has_many :comments
end

class Comment < ActiveRecord::Base
  belongs_to :post
end

I used the commands: rails generate scaffold post title:string body:text etc.

to create these files.

Now I wanted to generated the db using:

rake db:create

I got the error:

rake aborted!
can't convert Fixnum into String

Any ideas what the issue can be?

I'm following this tutorial: http://sixrevisions.com/web-development/how-to-create-a-blog-from-scratch-using-ruby-on-rails/

Here is the trace:

** Invoke db:create (first_time)
** Invoke db:load_config (first_time)
** Invoke rails_env (first_time)
** Execute rails_env
** Execute db:load_config
** Execute db:create
rake aborted!
can't convert Fixnum into String
/Library/Ruby/Gems/1.8/gems/mysql2-0.2.4/lib/mysql2/client.rb:36:in `connect'
/Library/Ruby/Gems/1.8/gems/mysql2-0.2.4/lib/mysql2/client.rb:36:in `initialize'
/Library/Ruby/Gems/1.8/gems/mysql2-0.2.4/lib/active_record/connection_adapters/mysql2_adapter.rb:14:in `new'
/Library/Ruby/Gems/1.8/gems/mysql2-0.2.4/lib/active_record/connection_adapters/mysql2_adapter.rb:14:in `mysql2_connection'
/Library/Ruby/Gems/1.8/gems/activerecord-3.0.0/lib/active_record/connection_adapters/abstract/connection_pool.rb:230:in `send'
/Library/Ruby/Gems/1.8/gems/activerecord-3.0.0/lib/active_record/connection_adapters/abstract/connection_pool.rb:230:in `new_connection'
/Library/Ruby/Gems/1.8/gems/activerecord-3.0.0/lib/active_record/connection_adapters/abstract/connection_pool.rb:238:in `checkout_new_connection'
/Library/Ruby/Gems/1.8/gems/activerecord-3.0.0/lib/active_record/connection_adapters/abstract/connection_pool.r