Pat the beef dry and cut it into roughly 2-inch (5 cm) chunks. Season all sides generously with salt and black pepper.

Place a large Dutch oven over medium heat and add a drizzle of olive oil. Add the bacon and cook until the fat is rendered and the pieces are nicely browned. Transfer the bacon to a plate, leaving the drippings in the pot.

Working in batches so the meat browns instead of steams, sear the beef in the hot bacon fat until each piece has a deep golden crust. Remove the beef to the plate with the bacon.

Lower the heat slightly and add the onion, carrots, smashed garlic, and 2 tablespoons butter. Cook for several minutes, stirring, until the onions begin to soften and lightly color.

Return the beef and bacon to the pot. Stir in the tomato paste until it coats the meat. Sprinkle the flour over everything and cook, stirring constantly, for about 2 minutes so the flour loses its raw taste and starts thickening the base. 

Pour in the red wine and beef broth, scraping the bottom of the pot to loosen all the flavorful browned bits. The liquid should mostly cover the meat; add a little more broth if needed. Add the thyme, bay leaves, and rosemary. 

Add the fresh herbs, wrapped in cheesecloth and tied with cooking twine. This is called a bouquet garni. If using dried herbs, add them now.

Bring the pot just to a gentle simmer, then cover.

For oven cooking: place in a 320°F (160°C convection) or 350°F (180°C conventional) oven and cook for 2 to 3 hours.

For stovetop cooking: keep at a very low simmer for about 1½ to 2 hours.

The sauce should barely bubble; avoid a hard boil, which can toughen the beef. Stir occasionally.

About 15 minutes before the stew is done, heat olive oil in a skillet and sauté the mushrooms until browned and slightly crisp around the edges. Set aside.

In the same skillet, add the shallots and pearl onions with a splash of water or wine, along with the remaining 2 tablespoons of butter. Cover and cook gently until the shallots are tender and lightly caramelized. Set aside.

Remove the pot from the oven if using the oven method.

Stir the mushrooms and shallots into the stew just before serving so they stay distinct and glossy in the sauce. 

Remove the fresh herbs.

Serve hot right from the Dutch oven, or serve on a large, deep platter. Serve with mashed potatoes, buttered noodles, or crusty bread.