It was the first time Crystal Palace had ever conceded seven goals at home in the club's history.
It was a masterclass from the reigning Premier League champions with Roberto Firmino and Mohamed Salah both scoring twice, while Takumi Minamino, Sadio Mane and Jordan Henderson also chipped in with one each.
Speaking to talkSPORT following the defeat, Hodgson said: "We are not frustrated, we are devastated by the result, we are humiliated by the result.
"We realise we've got lessons to learn from the result and performance and we also realise we've got to make certain we don't allow the residue of this result to impinge on the next games we've got to play.
"We've somehow got to find a way of getting ourselves back into the mental state we are going to need to confront the next two games and to make certain we learn any lessons from today's game while retaining some of the play and things we did that did not give me reason to be critical of.
"One of those things was that we kept going and that's quite important. It didn't help us in terms of conceding goals.
"Yes, they were (ruthless). They played extremely well. The scoreline is a very difficult scoreline to swallow.
"I don't feel in some ways that it was a scoreline merited us losing 7-0 but that's what's happened and obviously we've now got to try and learn lessons from it and most importantly we've got to get ourselves back on track again and come over this defeat.
"It can sometimes take a while to get over defeats but we don't have the time to allow ourselves what we might need to come over that defeat. We've got to do it in super quick time because we've got two matches coming up."
Minamino started the rout with his first Premier League goal for the club, a tidy finish inside the box which turned out to be the least attractive goal of the bunch.
Palace actually dominated for a spell with the score at 1-0 and really ought to have equalised, but then some clinical finishing put the game out of their reach.
Two more goals before half-time and then four after the break put the game well out of reach.
When asked if the first half could have been a different story if they'd converted their chances, Hodgson added: "That's nice of you to be so positive and I understand where you're coming from.
"To some extent that's how we saw it too but the bottom line is that even in that period we didn't find that pass, we didn't find that equaliser and we ended up conceding two more goals, one of which was on the stroke of half-time.
"0-1 at half-time would have been very difficult to come back from but 0-3 has you really staring down the barrel of the gun.
"We started the second half reasonably well but when that fourth goal goes in you know that's we've lost. The big question was could we keep going and keep the score down, well we did keep going but we couldn't keep the score down."
Roy Hodgson admitted he was 'humiliated and embarrassed' by his side's 7-0 thrashing by Liverpool on Saturday.