In a large Dutch oven, heat 1 tablespoon of olive oil over medium heat. Add the diced bacon and cook until crisp. Remove the bacon with a slotted spoon and set aside, leaving the rendered fat in the pot.

Pat the beef cubes dry with paper towels. Add them to the pot in batches, searing until browned on all sides. Remove and set aside.

Add the remaining tablespoon of olive oil if needed, and sauté the chopped onion and sliced carrots until softened, about 5 minutes.

Stir in the garlic and cook for 1 minute until fragrant.

Sprinkle the flour over the vegetables and stir to coat. Cook for 1–2 minutes to remove the raw flour taste.

Add the tomato paste, then slowly stir in the red wine, scraping up any browned bits from the bottom of the pot.

Return the beef and bacon to the pot, then add the beef stock. Bring the mixture to a simmer.

Cover and transfer the pot to a preheated 325°F (165°C) oven. Bake for 2½ to 3 hours, or until the beef is fork-tender.

About 30 minutes before the stew is done, heat a skillet over medium-high heat. Sauté the mushrooms and pearl onions in a bit of olive oil until golden and tender.

Add the mushrooms and onions to the stew during the last 30 minutes of cooking.

Once done, remove the stew from the oven, stir gently, and adjust seasoning with salt and pepper if needed.

Serve hot with mashed potatoes, buttered noodles, or crusty bread.