In a small bowl mix the red chili powder, ancho chile powder, ground cumin, oregano, thyme, and ground coriander seeds. Mix in water so that the spices forms a light paste. Set aside.
Cook the bacon in a large skillet on medium high heat until it's slightly underdone. Set aside on a paper towel. Leave the bacon fat in the skillet. When the bacon cools, chop it into bite-sized pieces and set aside.
Increase heat to medium high. Working in batches so that you don't crowd the beef , sear the beef cubes on all sides, lightly salting as you cook the beef. Remove beef from pan, set aside.
In the same skillet, add the chopped onions and saute until soft, about 5 minutes. Add and cook the garlic and jalapeno for a minute until fragrant. Add the chili paste and cook for 2-3 more minutes.
Into a 6-quart thick-bottomed Dutch oven or pot, put onion chili mixture, beef, bacon, broken down tomatoes (break up the whole tomatoes with your fingers as you put them in the pot), water, lime juice, and sugar. Heat the chili on medium high heat until it comes to a simmer. Reduce the heat to low. Cover and cook for 1 1/2 hours. Then uncover and simmer for another half hour.
Mix the cornstarch powder into a little water to dissolve the cornstarch completely and add to the chili to thicken it. Gently mix in the kidney beans. Add salt to taste.
Ladle into bowls and top with grated cheddar cheese and chopped onion.