The global economy was currently "a post-bubble world" with the burst of the property bubble, the credit bubble and the consumption bubble, with the last being the biggest bubble of all, Stephen Roach, chairman of Morgan Stanley Asia Limited, said Wednesday.

Speaking at the Asia meeting of the Clinton Global Initiative in Hong Kong, Roach said the consumption bubble was the biggest bubble of all.

"U.S. consumption last year accounted for 72 percent of the U.S. gross domestic product. No country in the world has ever consumed that much of their national product," he said.

Under de-leveraging pressure and with credit drying up, the U.S. consumers were now spending drastically less, leading to two consecutive declines of more than 3 percent in real consumption in the third and in the current quarter of this year.

"That's never happened in the U.S. economy, ever. You can see this magnitude," he said.

The burst of the consumption bubble in the United States was a big problem for developing Asia, and there was not a country in the region that was not under slowing or recession right now due to the problems in their end markets.

Roach said it was because developing Asia was more exports- dependent than ever before.

"The region's total 45 percent of national output goes to exports, 10 percent above than it was 10 years ago when it was in the Asian Financial Crisis," he said.

There will be no V shape recovery, the economist who had weathered several economic cycles said, adding that he was not sure whether it was going to be an L shape recovery or a very gentle up slope

There is a lot more to go in shaking out the excess in the system over the next few years, he said.

"One of the reasons why investors are on the sidelines is they are flirting with the idea that this may not be a short business cycle downturn but could be a long drawn-out multi-year process."

Bill Clinton, ironically, also said there is a need for the world to go back towards old-fashioned finance, referring to de- leveraging

"We will go back to old-fashioned finance to make a modern economy," he said in closing remarks at the Asia meeting of the Clinton Global Initiative.