Market saturation means that everyone who wants a smartphone already owns one.

and who can afford one.

Well, yes, but it's worth noting that smartphones are now down at the $40 and less level. And China doesn't have that many extremely poor people anymore.

That's a good point!

Read Hank Paulson's book, Dealing with China. The Communist Party can only extract so much value from to masses while corruption and opacity are the norm in government. Instead of looking at the economy as a virtuous cycle of re-investment making more resources available for collateral, they treat the economy like a well and wonder why it keeps running dry.

Peter Navarros Death by China is a good read too

I enjoyed reading China's Great wall of Debt and The Hundred-year marathon.

I can't help but think the "The Communist Party" in your comment could be replaced with any small group of people with defacto power over a nation ...