Your baby is an excellent listener. He recognizes your voice, and he'll show you his pleasure by smiling at the sound of your greetings. He's also excitedly using all five senses to learn about the world. You can actually see how hard he's working to assimilate the new information he's exposed to every day. If something grabs his attention, notice how hard he focuses on it and stares. He's taking it in on many levels.
Talk back. Reply to your baby when he begins to coo and gurgle and make noises directed at you. Not only will this delight him, but you'll be teaching him the back-and-forth of carrying on a conversation. Give him a chance to talk back to you before you continue.
Play when your baby is ready. You don't have to blab 24/7 — ordinary conversation will do. If your baby is tired or cranky, wait for a better time. By the same token, he'll also let you know when he's overstimulated and has had enough interaction.
Give everything a name. Use words to describe the objects around your baby. Give everything a label, and use those words over and over again.