Error when importing south with django after install

Question

This is my first time using Django and South.

I installed South V1.01 with pip, but when I run manage.py schemamigration myapp --initial

I get

File "manage.py", line 11, in <module>
execute_from_command_line(sys.argv)
File "/Library/Python/2.7/site-packages/django/core/management/__init__.py",     
line 385, in execute_from_command_line
utility.execute()
File "/Library/Python/2.7/site-packages/django/core/management/__init__.py", 
line 354, in execute
django.setup()
File "/Library/Python/2.7/site-packages/django/__init__.py", line 21, in setup
apps.populate(settings.INSTALLED_APPS)
File "/Library/Python/2.7/site-packages/django/apps/registry.py", line 85, in 
populate
app_config = AppConfig.create(entry)
File "/Library/Python/2.7/site-packages/django/apps/config.py", line 87, in   
create module = import_module(entry)
File     
     "/System/Library/Frameworks/Python.framework/Versions/2.7/lib/python2.7/importlib/__init__.py", line 37, in import_module __import__(name)

I have added myapp under INSTALLED_APPS in settings.py and I can see South installed correctly.

I would appreciate if anyone can tell my where to look for the fix.