It seems as though either the front fork where the frame and the fork meet. I flipped my stem the other day, and it seems like it just too loose, but I cannot tighten it anymore. Any suggestions?
Mine doesn't look exactly like this, but it is good for an illustration- It would be loose at the silver part where it looks welded(?) on that particular bike.

If it helps, what happens if I lift up on the frame, the fork seperates a bit from the frame.

If it is a new bike, you should take it to the shop where you bought it and have it adjusted properly.

However, in case that is not possible for some reason:

Your head set probably needs adjusting. Can you show what the headset near the top below the stem looks like (where the handlebar connects). There are a couple of different types that adjust differently.

By the way, if it is what I suspect, you should also see some movement near the stem when you lift up also. If not, I am lost.

EDIT: I just reread your first message... What is "flipped my stem?" Did you have an accident?

Did you re-adjust the headset after flipping the stem. Sounds like a headset adjustment is all you need.

After you flipped the stem, did you tighten the stem bolts before you tightened the head bolt? If so, do it the other way around. Tighten the head bolt until the fork/steerer tube is no longer loose, making sure that your steering is not impeded. After that, align the stem and tighten the stem bolts. If this doesn't make sense, check the Sheldon Brown and/or Park Tool websites. I forget the exact site names, but you can google them.

How do I go about adjusting the headset?

I expect it's athreadless headset and he removed the stem, flipped it over (to get more or less handlebar height), replaced the stem and just tightened the clamp bolts without setting the headset adjustment.

Go to the Park Tool web site (www.parktools.com) and look for "headset adjustments" in their repair section.

Sounds about right. Thanks for the link, I am checking it out right now.