It's actually quite smart considering the position they were in.
They had a squad that had to rely heavily on loans last year and being in the PL gets you a minimum of 86.5m (that's for bottom of the league) and on top of that, the parachute payments mean that if they were relegated, next season they would get 47.5m, the season after 38.9m and the 3rd season 17.3m, so this window will be potentially paid off in 2 to 3 seasons and that is the worst case scenario.
They have signed a mixture of young and experienced players and a mix of overseas players, PL experience and players who have excelled in the Championship (that they believe can make the step up), so even if they do go down, I bet they would back themselves to go straight back up again.