Here is some information about Megalopyge opercularis from Wikipedia:
The 'fur' of the larva contains venomous spines that cause extremely painful reactions in human skin upon contact. The reactions are sometimes localized to the affected area but are often very severe, radiating through the limb and causing numbness, tingling, rashes and blisters, and more systemic symptoms such as chest pain and anaphylaxis. Ironically, the resemblance of the larvae to soft, colorful cotton balls encourages people to pick them up and pet them.
Here is somebody who touched one:
When I was 7 years old playing in the backyard.I accidently rubbed my hand on this puss caterpillar & suffered afterwards.There was a burning itching sensation which developed into multiple red bumps & lesions all over my hand.Later on that day,I developed a fever & nausea.My parents rubbed natural herbal medicine on my hand to sooth the pain a little because we were poor so the hospital was out of the question.Next day,a huge bump filled with liquid developed in the middle of my hand surrounded by smaller red liquid bumps which still burned like hell.After a couple of days of natural treatments.The liquid bump bursted with oozing pus,revealing the red tender skin underneath.I still felt nauseated,but I felt alot better.A week later,my hand completely healed.Even though all this happened when I was a kid.I still remember it like it was yesterday.So always remember,a pus caterpillar has hidden hollow spines in it's fur filled with toxic poison.
Enjoy your day. ^_^