A Story Within A Story Within A Story Within.....

A frame inside a frame inside a frame

Chapter 8 of Slaughterhouse-Five is probably best described as a frame story. In fact, it's more than just that. It's more like a frame-frame-frame-frame story, or something along those lines. The entire chapter is interlocked as a paragon of Vonnegut's story-telling thus far. Inside a few of the stories, he tells stories of stories from the original frame, and vice versa.
For example, the chapter's original frame begins by describing American Nazi Howard W. Campbell, Jr. Edgar Derby would later stick up for American rights, telling Campbell he was something worse than a snake for being a traitor (Benedict Arnold-esque for leaving the American side).
The chapter then jumps to an original frame from long ago, with Billy's daughter scolding his behavior and wishing to kill Kilgore Trout for putting such crazy thoughts into his head.
Now the chapter shifts to a segue of Billy's first time meeting Trout, who is now a circulation man for the Ilium Gazette.
An excellent example of a frame inside this encounter is found on page 167, when Vonnegut describes the situation as, "'Hell no,' said Kilgore Trout. 'You think money grows on trees?' Trout, incidentally, had written a book about a money tree. It had twenty-dollar bills for leaves. Its flowers were government bonds. Its fruit was diamonds. It attracted human beings who killed each other around the roots and made very good fertilizer. So it goes." This frame story is somewhat of an aside because it is so brief; however it is a frame story because he shifts from the original story into a description of one of Trout's books, including several details.
More frames are found throughout the chapter, including Billy's eighteenth wedding anniversary party, his recall of the Dresden bombing (which is what I was talking about when I said he tells stories of stories from the original frame, or in this case, the beginning of the chapter), which leads to another story within a story, when Billy travels to Tralfamadore to tell Montana Wildhack of his experience after the bombing on the "moon" of Dresden.
This is an excellent transition from Vonnegut because the rest of the chapter focuses on the moon/Dresden. Billy Pilgrim was in his bedroom, reminiscing on the Dresden bombing, and the story shifts to that setting. Then, Billy comes unstuck in time and recalls when he told Montana Wildhack about the bombing. He then recalls fleeing to a suburb and finding an inn to sleep in for the night. In a way, Vonnegut has accomplished a difficult task of framing the anniversary party around Dresden bombing around Montana Wildhack in Tralfamadore around Dresden again.
Vonnegut probably placed the entirety of Chapter 8 in a frame setting to remind the reader of several various settings throughout the book's plot. He is also able to remind the reader of how Billy has been coming unstuck in time. However, the entire book has been centered around the Dresden bombing, and in this chapter, the reader encounters the climax of the plot of the bombing story. Personally, I am curious to find out what will happen in the next two chapters. How will Vonnegut be able to conclude all the side stories that have evolved throughout the entire book? I know Billy will live for a while because I already know how and when he will die. But how will everything else turn out? I guess I'll just have to read to find out.