how to solve “ruby installation is missing psych” error?

In my case

rvm pkg install libyaml

and

rvm reinstall ruby-1.9.3-p125

solved the problem.

For people using Ubuntu, make sure that libtool is installed prior to the steps above:

sudo apt-get install libtool

For macOS users (with homebrew):

rm -rf /usr/local/lib/ruby/gems/ && brew reinstall ruby