1) What actors and activities are you referring to exactly when you say "Wall St"? There are lots of players, and they have different roles. The performance of a given stock/fund is irrelevant to many players (exchanges, market makers, etc.) But yes, there are players that hold positions. You can call that gambling if you want, they definitely have risk, but all investments carry risk (even "risk-free" investments like government bonds). What exactly do you have a problem with? Vegas-style gambling is typically a zero sum game, with most of the money going to the house. Long term stock market investing generally yields a positive return.
2) The financial industry is also heavily regulated. I'm not sure why you're comparing Vegas and Wall St in this respect. You say that in Vegas "odds are clearly known", but this is not true in some common cases and it’s not clear what you’re getting at. What do you propose for Wall St in that respect? Odds can be published for games whose probabilities are known in advance (slots, roulette, etc.) But this is not true for things like sports betting and games of skill (poker, blackjack, etc.) No one knows what the “true” probability is that the Yankees will beat the Giants. What the casino will tell you is how much you need to wager to win a certain amount of money. You can infer an implied probability from that, but the same is true for prices in financial markets. If you look at prices of stocks, options, bonds, interest rates, etc. you can infer all sorts of information such as expected default rates, expected volatility of the price of a commodity, expected profitability of a company, etc.
When you say "casinos don't even need to cheat to be profitable" you seem to be implying that Wall St does. Exchanges charge transaction fees. Market makers earn a spread on their buys/sells. Brokers earn commissions. Banks earn the difference between the interest rates they charge vs. pay out. Can you explain why you think Wall St needs to cheat to be profitable?
2) The financial industry is also heavily regulated. I'm not sure why you're comparing Vegas and Wall St in this respect. You say that in Vegas "odds are clearly known", but this is not true in some common cases and it’s not clear what you’re getting at. What do you propose for Wall St in that respect? Odds can be published for games whose probabilities are known in advance (slots, roulette, etc.) But this is not true for things like sports betting and games of skill (poker, blackjack, etc.) No one knows what the “true” probability is that the Yankees will beat the Giants. What the casino will tell you is how much you need to wager to win a certain amount of money. You can infer an implied probability from that, but the same is true for prices in financial markets. If you look at prices of stocks, options, bonds, interest rates, etc. you can infer all sorts of information such as expected default rates, expected volatility of the price of a commodity, expected profitability of a company, etc.
When you say "casinos don't even need to cheat to be profitable" you seem to be implying that Wall St does. Exchanges charge transaction fees. Market makers earn a spread on their buys/sells. Brokers earn commissions. Banks earn the difference between the interest rates they charge vs. pay out. Can you explain why you think Wall St needs to cheat to be profitable?