Preheat the oven to 325°F and set a rack in the lower middle position.
Dry the beef with a paper towel season with the salt and pepper.
In a large Dutch oven or heavy soup pot, heat one tablespoon of the olive oil over medium-high heat. Brown the meat in batches for about 5 minutes per batch. Sear the meat until it develops and nice brown crust but no need to cook the meat through.
Transfer the meat to a warm plate and set aside.
Add the onions, garlic and balsamic vinegar; cook, stirring with a wooden spoon and scraping the brown bits from bottom of the pan, for about 5 minutes.
Stir in tomato paste and cook for another minute.
Add the beef and their juices back to the pan. Sprinkle with the flour and stir until the flour is dissolved for about two minutes.
Add the wine, beef broth, water, bay leaf, thyme, and sugar. Stir and loosen any brown bits from the bottom of the pan and bring to a boil.
Cover the pot with a lid, place into preheated oven, and braise for 2 hours.
Remove the pot from the oven and add the carrots and potatoes. Cover and place back in the oven for about an hour more, or until the vegetables are softened, the broth is thickened, and the meat is tender.
Remove the bay leaf and discard, then taste and adjust seasoning add more salt and pepper if necessary.
This stew always tastes better the next day refrigerating overnight allows the flavors to melt together.
Garnish with fresh parsley.
Enjoy with your favorite crusty bread.