People often say "icy" is the easiest word to spell...
People often say "icy" is the easiest word to spell, and, looking at it now, I see why.
The humor in this joke lies in the fact that the person just ended their sentence with the names of the letters of the word 'icy' - basically spelling icy in the process of discussing the spelling of icy.
This is funny because the sentence makes no sense until person that is hearing the joke recognizes that the entire joke was a set-up so that the jokester could spell icy.
Now, the spelling of icy is not actually all that easy. Isee is probably a more natural spelling of the word.
This joke fell flat on me.