<p>Password: <%= password_field_tag 'password' %></p>

<p>Confirm Password: <%= password_field_tag 'password_confirmation' %> <span id="password_match"></span></p>

<%= observe_field 'password_confirmation', {
    :url => { :action => 'compare_passwords' }, :frequency => 1,
    :with => "'password_confirmation=' + encodeURIComponent(value) + '&password=' + $F('password')" } %>