How to stop a hyper kitten from attacking older cat?

My new 4 month old female kitten thinks about one thing only – attacking everything that moves – our legs, hanging strings of any sort and best of all our 3 year old female cat. We tried nagging on her, locking her in a room for “chill time” and water spray bottle. Nothing works. She doesn’t seem to be effected by anything and goes right back to mischief. our three year old cat is very unhappy and stressed. She has to be in constant watch or she will be pinned down to the floor and bitten. One book about cat psyche told me to let the cats sort the conflict on their own. Well, that has been going on for over two months now. What to do?