Sabat, would you do the following for me?
Turn on Rails.
Open Firefox, type http://localhost:3000/a-malicious-string into the top bar. Hit enter.
Observe how that gets you a malicious string to your web server. This particular string will 404. I can construct much more interesting strings.
Now, notice that step where I told you a URL to type in? Pretend that, instead, I had control over some element of a webpage you were looking at. Any element would do. Say, you come to a blog where I control an image embed for my avatar, and I embed http://localhost:3000/a-malicious-string />. Firefox is going to make the HTTP request I desire without you having to do anything suspicious and without me having to ever talk to localhost:3000 directly.
After I have a malicious string in your web server, this application lets me execute arbitrary code as your web server. Things get very, very interesting then, in the "may you live in interesting times" sense of interesting. For example, one interesting thing I could do is read your SSH private key, which you use to connect from development to staging or production. Another thing I could do is read your database credentials from database.yml, and maybe even just open up extra ActiveRecord connections directly to those databases and start executing arbitrary SQL. Still another thing I could do is install a keylogger or rootkit on your local machine and wait to get whatever credential I need to totally compromise your company. There are many, many options.
Do not install this anywhere.