130 million isn't that much in today's terms. Guardiola had a time finding the right team last season and his requirements are high for the players. What surprised Guardiola last season probably was that he didn't do much differently and yet the whole team wasn't able to play like before anymore. I think from a team like that with so many top players, outsiders like us wouldn't expect a downfall like that. Many of these players were making mistakes that actually had nothing to do with their quality. It is not like passing the ball to the opponent right in front of their own box is a quality issue, it is a lack of focus and something went wrong that Guardiola couldn't fix.
He is now in the cumbersome situation that on the one hand he knows he has so many good players, on the other hand he knows how they have done last season. But he can't swap the whole squad. I think the next season won't be easy either for them. Much of the confidence they gained over the years went down the drain last season.
it's enough for Manchester City at the moment. The squad is not that bad if you look at it player to player. Maybe just make a few promising young talents that can act as back-ups to the first 11, and they are good to go.
I think what made Manchester City perform badly last season was just player morale because most of the good players we have known for quite a while were not themselves at all.