gistfile1.rb

class Chef
  class Recipe
    class ProTip
      class StreamReader
        require 'stringio'
        def initialize
          @callbacks = Hash.new { |h, k| h[k] = [] }
          @buffer = StringIO.new
        end

        def on(type, &blk)
          @callbacks[type] << blk
        end

        def << (chunk)
          @callbacks[:read].each { |blk| blk.call(chunk) }
          @buffer.write(chunk)
          @buffer.rewind
          leftover = ''
          @buffer.readlines.each do |read_line|
            if read_line =~ /\n/
              @callbacks[:line].each do |blk|
                blk.call(read_line.chomp)
              end
            else
              leftover = read_line
            end
          end
          @buffer = StringIO.new
          @buffer.write(leftover)
        end
      end
    end
  end
end

stream_reader = Chef::Recipe::ProTip::StreamReader.new.on(:line) do |line|
      Chef::Log.debug(line)
end

result = shell_out!(cmd, {:live_stream => stream_reader, :returns => [0,100], :timeout => 3600 })

Thanks - how would I use it?