
This fluffy creature is called a Woolly Aphid. They are sometimes referred to as a "Fairy Fly", among other nicknames. Due to their whimsical appearance, some parents tell children that they carry wishes, live in tulips and much like fairies, are born every time you make a wish on a dandelion.
On the more practical side of things, Woolly Aphids are not generally much cause for alarm, although they can cause rather unsightly damage to plants. They feed by inserting their needle-like mouth parts into plants to withdraw the sap. They feed on the leaves, buds, bark and even the roots. As they feed, they produce a sticky substance known as honeydew, which can cause "sooty mold" on the plants.
I haven't laid eyes on them since that day. I've never noticed any type of damage I could attribute to their feeding habits and I abstain from using any type of insecticide or pesticide. I find them to be beautiful creatures and I love the fairy tale version of their existence.
Resource: http://en.wikipedia.org/wiki/Eriosomatinae
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