By SABC Sport
22nd February 2023
Klopp's side raced into a two-goal lead through Darwin Nunez and Mohamed Salah, but were pegged back before half-time by Vinicius Junior's double.
Madrid seized the initiative after the restart and struck three more times through Eder Militao and a brace from Karim Benzema.
The Spanish champions have all but booked their place in the quarter-finals as Liverpool would need to win by four clear goals in the return in Madrid.
It is the first time Liverpool have conceded five goals at home in a Champions League tie and Gerrard said "there's got to be an inquest".
Gerrard told BT Sport: "It's a reality check. Liverpool got off to the perfect start, exactly what you need in a European night, fast, get yourself in front, build on it, 2-0 up.
"But from that moment Real Madrid came back into it, scored quite quick, a fantastic goal, and from then Liverpool were dominated and outclassed for large periods.
"At any club, if you concede five goals there's got to be an inquest into why and how. I'm sure Jurgen will do that in the coming days.
"Everybody will be raw after that. Liverpool don't concede five goals at Anfield, it's very rare and there will be some soul-searching.
"Sometimes in football you've got to put your hands up and say the best team won, you were outclassed, you were dominated. They were better in most areas of the pitch. We're witnessing absolute greatness in (Luka) Modric and Benzema."
Liverpool midfielder Jordan Henderson admitted the defeat was difficult to digest.
Henderson told BT Sport: "Very difficult to sum it up straight after the game. We're disappointed and frustrated with the result, but for large parts of the first half, definitely, I felt we performed well.
"It's difficult to come here and speak. Yes, they have a lot of quality and we knew that and when you're not 100 per cent when defending they punish you, and we caused ourselves problems at times."