If you see this error on a Mac while compiling Pugs, it means you're using the normal gcc instead of Apple's special gcc (look in /usr/bin for that one).
*** Building the 'fps' dependency. Please wait...
Preprocessing library pugs-fps-0.7... Building pugs-fps-0.7... [1 of 1] Compiling FPS_Dummy ( FPS_Dummy.hs, dist/build/FPS_Dummy.o ) cc1: error: unrecognized command line option "-mdynamic-no-pic"