I have installed a new rails project like so:
$ rails new site
and it executes and reaches:
bundle install
<
First uninstall any existing atomic gem
gem uninstall atomic
Then reinstall it using
gem install atomic -v '1.1.16'
After this try to create a new rails application
rails new projectname
I don't know which version of Rails you are currently using. Sometimes, re-installing Rails to a stable version seems to help. You may want to try that as well if the above steps didn't resolve the issue.