Start by sautéing the bacon in a Dutch oven over medium-high heat (for about 3 minutes). Once the bacon is crispy and golden-brown, remove it and set aside.
Next, cut the beef into 2 inch chunks and season with salt and pepper. Add to the Dutch oven in one layer into the bacon grease. Brown on each side for about 4 minutes or until it reaches a darker brown color. Work in batches if needed. Once browned, remove and set aside with the bacon.
Add 1/4 cup of red wine and deglaze the Dutch oven.
Add onion and carrots, stir and cook for 3-4 minutes. Add garlic, stir and cook until fragrant, about 1 minute.
Add the beef and bacon to the Dutch oven. Stir to combine. Add dried thyme, dried parsley and tomato paste. Stir to combine.
Add the rest of the wine. Add beef broth, one cup at a time, just enough to cover the beef.
Place a large skillet over medium heat and add butter, once melted, sauté the mushrooms for about 5 minutes. Add flour and stir well to combine. The mixture will be dry, make sure the flour absorbed all the butter.
Add the mushrooms and flour mix to the Dutch oven. Add the pearl onions. Mix well to combine all of the ingredients and bring to a simmer.
Add bay leaves and thyme sprigs on top.
Cover the pot with a tight-fitting lid and place it in the oven for about 1 1/4 - 1 1/2 hours or until the meat and vegetables are very tender when pierced with a fork.
Serve warm over some rice or pasta with crusty bread on the side.