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Try a sling. Remember he has only just come out of being a part of you. Try not to expect to much. Are you wrapping him? This often helps. But besides that, just hold him, feed him, love him, gaze upon him...
ABA has a great sling that holds the baby against you, not in a pouch that is attached to you. Have a look on the Mothers Direct website (just goggle mothersdirect it should come up) its listed in Out & about or maybe its just under slings??. Anyway its the "Simplisity" clip on sling. Trust me very well worth it if you get one.
As for co sleeping, check out the SIDs web site for safe guidelines on co-sleeping. I doubt you will squash him.
