Klopp is one of the top 10 managers in the world, at a club that is no where near the top 10 clubs in the world, so I think this is a combination of the owners being impressed with his performance so far and fending off possible interest from other clubs that are more successful atm.
We all know there will be some very big clubs firing managers come the new year as they cannot all be successful, so teams like Real Madrid/PSG/Juventus/Bayern Munich/Chelsea/Arsenal/FA may all be looking for a new manager, if they are, Klopp would be near the top of their wanted list if he has a good start of the season with Liverpool.
Contracts are not worth much these days, so if things don't work out well, I'm sure FSG will just fire Klopp and pay him off, though he does appear loyal, this is more to tie him to the club and stop him being poached.
I hope it is also a good sign that the club are backing his player choices, as I cannot see him signing an extension if FSG have been messing him around with transfers/money/player choices.
