Preheat your oven to 350°F (175°C). In a large Dutch oven or oven-safe pot, cook the chopped bacon over medium heat until crispy. Remove the bacon with a slotted spoon, leaving the rendered fat in the pot. Pat the beef cubes dry, season generously with salt and black pepper, then dust them with all-purpose flour. Sear the floured beef in batches in the hot bacon fat until deeply browned on all sides, ensuring not to overcrowd the pot. I always make sure there's enough room in the pot when browning meat to get a good crust, which adds a lot of flavor.

Reduce the heat in the pot to medium-low. Add the carrots and quartered yellow onion, cooking until softened, about 5 minutes. Stir in the minced garlic and tomato paste, cooking for another minute until fragrant. Pour in the Cognac, carefully ignite it with a long match if you're feeling adventurous (or just let it cook down), and scrape the bottom of the pot with a wooden spoon to release any browned bits. This deglazing step is crucial for flavor!

Return the seared beef and cooked bacon to the pot with the aromatic base. Pour in the 2 cups of red wine and beef stock, ensuring the meat is mostly submerged. Add the fresh thyme sprigs, bay leaves, and adjust seasoning with salt and pepper. Bring the liquid to a gentle simmer, then cover the pot. Transfer the covered pot to the preheated 350°F (175°C) oven and braise for 2.5 to 3 hours, or until the beef is fork-tender. I always trust my nose and the texture of the meat more than the clock here; when it's fall-apart tender, it's done!

While the stew is braising, prepare the mushroom and pearl onion garnish. In a separate skillet, melt the unsalted butter with the olive oil over medium-high heat. Add the quartered button mushrooms and cook, stirring occasionally, until they are nicely browned and tender, about 10 minutes. Add the thawed frozen pearl onions, 1/2 cup red wine, 1 tsp fresh thyme leaves, and 1 bay leaf. Simmer until the wine reduces and the onions are soft and glazed. Season with salt and pepper to taste.

Once the beef is tender, carefully remove the stew from the oven. Discard the bay leaves and thyme stems; if you used fresh thyme in sprigs, remove those. Skim any excess fat from the surface of the stew. Stir in the prepared mushroom and pearl onion mixture. Taste and adjust seasonings as needed. Serve hot, garnished with fresh parsley if desired. For the best flavor, I often find stews taste even better the next day after the flavors have had more time to meld.